This paper investigates the effect of relationship-lending on loan contract terms, especially on the interest rate, loan value, and collateral requirements. For this purpose, data on 4850 loans granted by a bank in 2016 is employed. Our estimations show a negative and significant relationship between the interest rate and quality and quantity of borrower-lender relationship. Furthermore, there ...

The risk of a reputation loss can provide an informal enforcement mechanism when contracts are incomplete. This paper provides evidence that reputation and formal incentives to monitor are substitutes in syndicated lending. Formal incentives in a loan syndicate are determined by the amount of funding the monitoring bank provides to a loan. Using within-firm estimators, we show that monitoring b...

Iranian banking network policymakers are focused on bank consolidation as one of the reform policies in recent years. But before merging banks, it is necessary to examine their effects. Loans are one crucial item in the bankschr('39') balance sheets that are affected by bank consolidation. In the Iranian banking network, loans are offered to various economic sectors. What is important for banki...

Mobile banking is getting a lot of attention as a result of the fact that the majority of the world population has some kind of mobile device and the rate of acceptance of mobile banking is increasing. To stay ahead of competition banks should take this opportunity to re-engineer the traditional time consuming process of loan negotiation and introduce mobile loan negotiation. In this work we pr...

This paper hypothesizes that the special role of banks as corporate quasi-insiders has been changing due to developments in informational, legal and institutional infrastructures of syndicated loan markets. We investigate the integration of intermediated and disintermediated financial markets through highly leveraged transaction (HLT) syndicated loans during the 1990s. We demonstrate that, with...

This paper models loan rate-setting behavior, taking into account the product pricing and performance of the borrowing firm, and also calculates the bank’s loan-risk sensitive equity values. The lending function creates the need to model bank equity as a capped call option, which captures the credit risk directly related to management of a firm’s operations. When the product price set by the bo...

For purposes of this subpart: Bank holding company means any company that controls a bank (as provided in section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.)). Consultant. For purposes of this subpart, a consultant for a national bank, savings association, bank holding company, savings and loan holding company, or other company shall include only an individual who works d...

documentary credit or letter of credit (lc) is one of the methods of payment in international commerce. the documentary credit is a binding commitment from the issuing bank to pay a sum of money to the beneficiary on certain conditions. the applicant needs to contract with an issuing bank to open a lc. the legal nature of such contract is a controversy issue and thus different opinions are brou...